Corporate Governance versus Business Ethics with particular reference to ethics of Human Resource Management

Dear Students,

Often we came across the terms Corporate Governance and Business Ehics and are intrigued by the question whether these two are one and the same or different and more so, what are the ethics relating to Human Resource Management.

The following lines will aptly bear this out:

Corporate governance is most often viewed as both the structure and the relationships which determine corporate direction and performance. The board of directors is typically central to corporate governance. Its relationship to the other primary participants, typically shareholders and management, is critical. Additional participants include employees, customers, suppliers, and creditors. The corporate governance framework also depends on the legal, regulatory, institutional and ethical environment of the community.

Business ethics is a form of applied ethics that examines ethical principles and moral or ethical problems that arise in a business environment.Business ethics can be both a normative and a descriptive discipline. As a corporate practice and a career specialization, the field is primarily normative. In academia descriptive approaches are also taken. The range and quantity of business ethical issues reflects the degree to which business is perceived to be at odds with non-economic social values. Historically, interest in business ethics accelerated dramatically during the 1980s and 1990s, both within major corporations and within academia. For example, today most major corporate websites lay emphasis on commitment to promoting non-economic social values under a variety of headings (e.g. ethics codes, social responsibility charters).

Ethics of human resource management

The ethics of human resource management (HRM) covers those ethical issues arising around the employer-employee relationship, such as the rights and duties owed between employer and employee.

• Discrimination issues include discrimination on the bases of age (ageism), gender, race, religion, disabilities, weight and attractiveness.
• Issues surrounding the representation of employees and the democratization of the workplace: union busting, strike breaking.
• Issues affecting the privacy of the employee: workplace surveillance, drug testing.
• Issues affecting the privacy of the employer: whistle-blowing.
• Issues relating to the fairness of the employment contract and the balance of power between employer and employee: slavery, indentured servitude, employment law.
• Occupational safety and health.

Best wishes,

Prof. D. P. Chattopadhyay
(Globsyn Business School)